BC's Christy Clark had fantasies of massive tankers ferrying liquid natural gas to eager markets in Asia. Every Alberta premier since Peter Lougheed and every recent Canadian prime minister has had similar wet dreams about vast wealth to be had for allowing foreigners to extract and export Athabasca bitumen. Surely China, wonderful China, was simply waiting to bury us in their mighty yuan.
Reuters reports that China is experiencing petro-bloat.
Some of China's top oil refineries are having to take the highly unusual step of cutting operations during what is typically the peak demand summer season when hot weather drives up power usage and families take to the road during school holidays.
Almost 10 percent of China's refining capacity is set to be shut down during the third quarter, signaling that demand growth from the world's top crude importer is stuttering further.
West African and European suppliers are already feeling the chill from China's reduced demand, and a global glut has dragged spot prices for crude this week to their lowest since November, 2016.
Major Chinese oil refineries, including PetroChina's Jinzhou will set their run rates around 6,500 barrels per day (bpd) lower than the second quarter, sources at the affected refineries said.
Petrochina's Fushun refinery, with an annual capacity of 233,200 bpd, began a 45-day full shutdown at the start of June, the sources said on condition of anonymity as they are not authorized to speak to media.
Rival Sinopec is considering slashing as much as 230,000 bpd, equivalent to about 5 percent of its average daily production last year, in what would be only the second time in 16 years that the firm has cut runs.
Imagine Canada having to compete with China across the rest of Asia Pacific.
To whittle down the surplus weighing on the domestic market, analysts expect China to export refined product, putting more pressure on a well supplied global markets.
"China will have to export product... onto Asian markets, which given demand conditions regionally does not appear particularly constructive," said Harry Tchilinguirian, head of commodity strategy at French bank BNP Paribas.